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UK-wide the unemployment rate fell to 4 per cent - the lowest for more than 40 years.

Compared with April to June 2017 - when Scottish employment was at a record high - the number seeking work was up by 7,000 and those aged 16 to 64 in work was down by 3,000.

Scottish Chambers of Commerce chief executive Liz Cameron said the jobs market was "continually breaking records while highlighting some of the persistent challenges present in the economy".

She said: “Concerns remain around pay growth and productivity. The latest data has shown that the rate of pay growth is slowing, with pay remaining below the pre-downturn peak for UK workers.

"It appears that the tight labour market is yet to have a commensurate impact on worker’s pay. The Bank of England justified the latest base rate rise partially through the expectation of higher wages for UK workers, but the data shows that these forecasted rises remain elusive.

“The latest productivity estimate is encouraging in that it shows increased output per hour across the UK, particularly driven by services and growth in retail, aided by the warm weather. The rise in productivity is the highest quarterly increase since late 2016, but productivity increases remain weak historically.

“The unemployment rate across the UK has not been lower since 1975. In Scotland, although the unemployment rate has decreased by 0.1 percentage points on the quarter, Scotland is one of only four regions in the UK to observe an increase over the year on unemployment, of 0.3 percentage points.

"However, the rate remains close to historic lows, at 4.2%. In further positive news, the youth unemployment rate across the UK has fallen to 11.3%, the lowest rate observed since records began in 1992, with Scotland’s rate even lower.

“We remain optimistic that decisive actions to expand the UK’s future industrial capacity, such as the recently announced investments in key manufacturing hubs, as well as an ambitious Programme for Government from the Scottish Government, will set our economy on the right path towards sustainable long-term growth.

"It is only by addressing some of the fundamental challenges around productivity, that we will see the sustained pay growth across Scotland that will benefit all of civic society.”

The Federation of Small Businesses praised the figures but called for more action to boost workforce skills.

Andrew McRae, the FSB's Scotland Policy Chair, said: “Falling unemployment is good news for communities up and down Scotland, no matter how small the decrease.

"Despite a tricky political backdrop, many Scottish smaller firms are ploughing on – taking on staff and growing their businesses.

“But if we want to turn these historically good unemployment figures into sustained growth, we need to boost the country’s skills. As the Scottish Government looks toward priorities for the year ahead, we’ve made the case for new measures to encourage more people to improve their skills – especially those in work.

“That might mean the development of more vocational skills academies or action to encourage the biggest businesses to support the development of their supply chain. Likely forthcoming immigration changes and rapidly advancing technology underlines the case for a smarter Scottish skills system for those already employed.”

Dr Stuart McIntyre, of the University of Strathclyde's Fraser of Allander Institute said Scotland and the UK were experiencing "historically low levels of unemployment and high levels of employment".

Mr McIntyre highlighted that Scotland "outperforms the UK by some margin" on the youth unemployment front, with a current rate of 9.3% north of the border compared with 11.3% for the UK as a whole.

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Scottish business minister Jamie Hepburn said the figures were "welcome", adding: "Scotland's economy and jobs market remains strong despite the continued challenges facing our economy as a result of Brexit uncertainty."

Meanwhile the number of EU nationals working in the UK fell by 86,000 to 2.28 million - the largest fall since records began.